Mighty Ape acquired by Kogan.com

New Zealand’s first exclusive e-commerce retailer, Mighty Ape, was sold to Australian insurance and retail company Kogan for A $ 122.4 million ($ 128.3 million).

Kogan.com has acquired 100 percent of the business, however, Mighty Ape founder Simon Barton will remain as CEO of the organization.

Mighty Ape has more than 895,000 subscribers and in the 12 months to September generated more than A $ 120 million in revenue and a gross profit of A $ 37.8 million. For the current financial year ending March 31, 2021, the online retailer is expected to post a profit of $ 45.7 million, an increase of about 58 percent.

Under the acquisition agreement, Kogan will buy the company for A $ 122.4 million in four payment tranches, financed from the company’s cash reserves, as part of its plans to accelerate its growth in Australia and New Zealand.

The Mighty Ape executive team has been hired to at least deliver the financial result for fiscal year 23.

Kogan says that the acquisition and merger of the two markets will allow Mighty Ape to scale using Kogan’s infrastructure and will significantly increase the Australian company’s share of the New Zealand market.

Kogan.com COO and CFO David Shafer said Kogan was “a natural home” for the Mighty Ape, who share similar stories and values.

“Mighty Ape will give us significant scale in New Zealand and greater strength across a variety of operational dimensions. We will leverage Mighty Ape’s deep experience in games, toys and other categories of entertainment products and the New Zealand market, and combine this experience with Kogan.com’s sourcing, technology, systems, infrastructure and market capabilities to further enhance the group’s already market-leading offering in Tasmania, “Shafer said in a statement.

Kogan says there are “significant revenue and cost synergies” expected in the merged group.

Simon Barton, principal shareholder and CEO of Silverdale-based Mighty Ape, said the company was happy to join forces with Kogan.com Group for the next stage of its growth.

“Combining with Kogan.com will help Mighty Ape expand our product range and improve our customer experience. I am excited to be working with David and Ruslan and the broader team at Kogan.com, who have built an incredible business, by while aligning and creating more growth opportunities for the incredible team that helped build the Mighty Ape. “

Kogan is listed on the Australian Stock Exchange and was founded by Ruslan Kogan, who acquired the intellectual property of the failed electronics retailer Dick Smith.

Mighty Ape was launched in the 1990s, originally as Gamezone with physical stores, and in the early 2000s it began to extend its product range to DVD, computer hardware, music, and books. It became an exclusive e-commerce retailer in 2008 after a major rebrand.

The online retail market in New Zealand is expected to be worth $ 6.8 billion by 2026. Now worth around $ 5 billion, it is expected to grow 14.6 percent year-on-year from the year fiscal year 20 to fiscal year 21.

New Zealanders spent 33.4 percent more on national e-commerce sites in September compared to the same month a year earlier, and two-thirds of the population now shop regularly online.